Notes & Taxes: What's the story??? - Posted by drew

Real Estate Investing
1

Posted by drew on May 14, 1999 at 20:22:51:

this is one of the facets of notes that I haven’t seen much conversation about. Thanks for your reply and your many informative posts!

-drew

2

Notes & Taxes: What’s the story??? - Posted by drew

Posted by drew on May 13, 1999 at 10:35:01:

Please forgive me if this has been covered here before, but I am a bit confused. For example, let’s assume that I bought a $100,000 note for $60,000. In what way am I taxed if:

  1. I hold the note and just receive payments until it ammortizes?

  2. The note is paid off for $80,000 immediately after I buy it?

Thanks for your help!

-drew

3

Re: Notes & Taxes: What’s the story??? - Posted by David Alexander

Posted by David Alexander on May 13, 1999 at 13:27:51:

I believe, don’t qoute me, untill someone else backs this up.

As long as you or the corp your doing the deals in isn’t labeled a dealer,

on scenario 1. You could use Installment Sales gain,
possibly tax form 6252(memory, not positive)

  1. If you held longer than 2 years I think you could do a tax deferred exchange.
    2A. It would be a capital gain, taxed immediately.

Wait for others to qualify this.

David Alexander